Spotify is the world’s biggest music streaming platform by number of subscribers. Users of the service simply need to register to have access to one of the largest collections of music in history, plus podcasts and other audio content.
It operates on a freemium model. Free Spotify access comes with lower sound quality, advertisements and requires an internet connection. Those who pay for Spotify Premium can listen uninterrupted to high-quality recordings and are able to download songs for offline listening.
Spotify was founded in 2006 in Stockholm, Sweden, by Daniel Ek and Martin Lorentzon. The two wanted to create a legal digital music platform to respond to growing challenge of online music piracy in the early 2000s.
Eventually convincing record labels to agree to share content in return for an aggregate 20 percent stake, Spotify was launched in 2008. It was an instant success, with a Facebook partnership helping it rise rapidly to prominence. Surviving the transition to mobile, Spotify went public in April 2018, with a market cap of $26.5 billion after the first day of trading.
It has drawn criticism from recording artists, who complain that it pays too little. Claims to democratize the music industry have also been questioned, with the world’s biggest four music labels responsible for 87 percent of content available on Spotify.
Unfair or not, with the days of physical music long behind us (with the exception of vinyl junkies), Spotify dominates the way we consume music this century. It does not have the run of the market, however. Its rivals include Deezer, Pandora, and most ominously Apple Music, which has gained market leadership in the US and a few other countries.
Spotify has branched off into podcasts, acquiring some of the leading podcasters and podcast networks, such as the Joe Rogan Experience, The Ringer, and Gimlet Media. It sees this as the next pillar of its streaming service, potentially keeping users locked onto the platform for longer.
It also, along with most social networks, launched a Clubhouse-like live audio platform, which it first named Greenroom but relaunched as Spotify Live. Like Clubhouse, live audio has fallen off somewhat since the pandemic, but Spotify and Twitter look best to capitalize on whatever audience is left.
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